Letsbuyit faces bankruptcy

Letsbuyit.com, the cooperative buying website, will be wound up on Friday at a bankruptcy hearing in Amsterdam unless its management team can convince a judge to give it a stay of execution.

The firm's administrators yesterday applied to the court to convert the order granting the Dutch branch of Letsbuyit.com protection from creditors until 14 March to bankruptcy proceedings affecting all the company's 14 European operations.

A statement from administrators confirmed that Letsbuyit's management would contest the application. It said: "The present management still sees chances for survival and has indicated it will put forward a defence."

Press reports from the Netherlands have also indicated that one of the company's leading creditors may also seek to oppose the wind-up order. The unnamed party is quoted as saying it believes that giving the company the chance to continue trading may prove a better bet in the long-term.

Staff at Letsbuyit's UK office stopped taking customer phone enquiries on Wednesday afternoon and are not expected to resume customer service duties unless the company receives a stay of execution at Friday's bankruptcy hearing.

Until yesterday, customer support staff had told customers awaiting delivery of goods that they would either eventually receive what they had ordered or a full refund.

Rivals, French-owned Dealpartners and the Norwegian CoShopper, have talked to administrators about acquiring parts of the company's operations, such as its subscriber list, but are not thought to be interested in an outright acquisition.

Letsbuyit management, lead by acting chief executive and company founder John Palmer, are believed to be looking to raise 40m euros to take the company through to profitability in the last quarter of 2002. The firm's previous management, which resigned on 3 January, had been trying to raise 80m euros.

Investors have put in 182m euros so far. European rivals have said the firm simply spent too much establishing a pan-European brand too quickly. Bankruptcy would result in 320 job losses across Europe in what would be the continent's biggest dotcom collapse.

However, there have been none of the stories of extravagant spending on freebies that came with the collapse of fashion etailer Boo.com last year, which burnt 135m euros of investors' money in little over a year.

See also:

Letsbuyit reopens with good intentions

Embattled co-op buying website Letsbuyit.com has re-opened for business, promising to quickly clear the backlog of two-month-old customer orders on its books.  26 Feb 2001

Letsbuyit.com receives funding lifeline

Shares in Letsbuyit.com surged this morning after the co-operative buying website provider said it had secured enough funds to see it through to profitability in 2002.  06 Feb 2001

Letsbuyit axes 200 jobs

Co-operative buying website Letsbuyit.com made around 200 of its 350 staff redundant on Wednesday.  31 Jan 2001

Ex-hacker to take axe to Letsbuyit offices

The reformed hacker and driving force behind Letsbuyit.com's German venture capitalist saviour Kimvestor, has warned that four of the firm's 14 European offices will close to slash monthly losses estimated at 8m euros.  26 Jan 2001

Last minute rescue for Letsbuyit.com

Troubled co-operative purchasing website Letsbuyit.com has raised the 4m euros needed to avoid being declared bankrupt by a Dutch court today.  25 Jan 2001

Letsbuyit.com escapes wind-up order

Threatened Letsbuyit.com, the co-operative buying website, has dodged the threat of bankruptcy, at least for another six days.  19 Jan 2001

News Wrap: LetsbuyIt, Network Associates, BT, Xbox

LetsBuyIt management quit; Network Associates fills chief executive slot; BT seeks cash from property assets; Microsoft Xbox pictures escape.  04 Jan 2001

Reality bites for dotcom professionals

High-profile failures and devalued share options are making workers think more carefully about moving to ebusiness startups.  24 Sep 2000

Group buying market poised to soar

With considerable savings to be made on the purchase of a range of consumer products, group buying through small dotcoms is becoming increasingly popular. But what if the big boys like Yahoo and America Online muscle in on the act, as they surely will?  26 Apr 2000

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